PNC Financial Services Group Inc.'s first-quarter earnings rose 27%, handily beating analysts' estimates, following year-earlier writedowns as revenue increased and credit-loss provisions fell.
"We began to see signs that the pace of credit deterioration had eased at the end of 2009, which is reflected in our lower first quarter provision for credit losses," said Chairman and Chief Executive James Rohr.
The Pittsburgh-based bank saw its revenue boosted last year because of its acquisition of National City. Regional banks have largely reported improved first-quarter results in the past week as the economy has gotten better. In February, PNC sold stock and paid off the $7.6 billion it owed the U.S. Treasury under the Troubled Asset Relief Program.
PNC, which has a big presence in New Jersey and eastern Pennsylvania, reported its earnings rose to $671 million from $530 million, but they fell to 66 cents a share from $1.03 due to preferred-stock impacts largely related to TARP. Shares outstanding also were 18% higher in the most-recent quarter.
Excluding the TARP related impacts and other adjustments, earnings rose to $1.31 from $1.11 as revenue increased 2.1% to $3.76 billion. But the per-share loss narrowed to $1.05 from $1.10 as shares outstanding rose 13%.
Analysts polled by Thomson Reuters had most recently forecast earnings of 71 cents on $3.85 billion in revenue.
Credit-loss provisions were $751 million, down from $880 million a year earlier and $1.05 billion in the prior quarter. Net charge-offs, or loans lenders don't think are collectible, were 1.77%, compared with 1.01% and 2.09%, respectively. Nonperforming loans, those near default, climbed to 2.46% from 1.23% and 2.34%.
Shares closed at $65.30 Wednesday and were inactive premarket. The stock has risen 72% in the past year.